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The way I see it there's two key jobs involved in creating a web site - the design; this needs to be done by a creative person with a flare for visual art - they need to know how to use Photoshop and Illustrator, but they don't necessarily need to be technically inclined and don't necessarily have to know HTML. Then there's the techy job of putting it together into something that will work in a browser - "Web Development" as opposed to web design. This is what I do, and it's distinct from the job of actual design - I don't claim to have any idea what looks good on the screen, but I do know PHP and HTML inside out. I will normally work with a designer who is the opposite - he knows what looks good on screen but doesn't normally know a lot of the technical details of how things go together.
SEO - search engine optimisation is something that both designer and developer have to keep in mind when creating a site - it's a case of making sure the appropriate keywords appear in the right places on the site, making sure the URLs are search engine friendly, things like that. It's more than that though - in a company SEO will often be handled by the marketing department rather than the IT department - it's about establishing links with complementary websites and building content.
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